By March 30 of each year, the AHCCCS Director is required to apply to the Centers for Medicare and Medicaid Services for waivers or amendments to the current section 1115 waiver to allow Arizona to institute a work requirement for all "able-bodied" (defined) adults receiving AHCCCS services, place a lifetime limit of five years of benefits on able-bodied adults except in specified conditions, and develop and impose meaningful copayments to deter the nonemergency use of emergency departments and the use of ambulance services for nonemergency transportation or when it is not medically necessary. By April 1 of each year, the Director is required to submit a letter confirming the submission of the waiver requests to the Governor and the Legislature.

The AHCCCS Administration is required to establish a children’s rehabilitative services program for “children who have a chronic illness or physical disability” (defined) and to establish policies for that program, including medical eligibility and all rules for operation. Requirements for the program are specified. The AHCCCS Director is required to issue a public request for proposals at least once every five years to contract for the care and treatment of children in the program. The AHCCCS Administration is required to coordinate benefits so that any costs payable by the Administration are costs avoided or recovered from any available provider of first-party health insurance benefits. The Department of Health Services replaces the AHCCCS Administration in current statute permitting the agency to develop and operate children’s rehabilitative services, subject to the availability of monies. AS SIGNED BY GOVERNOR.

A person is prohibited from acting as a “transportation network company” (TNC) (defined) driver in Arizona unless the TNC has a permit issued by the Department of Weights and Measures. The Dept is authorized to charge and collect an application fee and must issue a permit to an applicant the meets statutory requirements. A TNC vehicle is required to display “trade dress” (defined) while being used to provide transportation network services. A TNC is authorized to charge a fare for transportation network services and must disclose to passengers the fare calculation method on its website or within the “digital network or software application” (APP) (defined). The TNC is required to provide passengers with the rates being charged and the option to receive an estimated fare before the passenger enters the TNC vehicle. A TNC is required to implement a zero-tolerance policy on the use of drugs and alcohol while a TNC driver is providing transportation network services or is logged in to the APP. Establishes requirements for a person be a TNC driver, including a local and national criminal background check, a driving history report, and state vehicle safety and emissions standards for private vehicles. Persons who have been convicted of specified violations or have had more than three moving violations in the preceding three years are prohibited from acting as a TNC driver. A TNC driver is prohibited from accepting rides other than those booked through the APP, and a civil penalty of up to $1,500 per violation is imposed on any TNC driver found to be soliciting or accepting street hails. A TNC with a valid permit and a TNC driver cannot be required to pay transaction privilege tax or any similar tax imposed by any taxing authority in Arizona on transactions in which a TNC driver is providing transportation network services. A TNC is required to disclose specified information to its drivers before the drivers may accept a request for transportation network services on the TNC’s APP. The regulation and use of TNC vehicles and TNCs are of statewide concern and not subject to further regulation by counties and municipalities. Establishes minimum amounts of insurance coverage that must be maintained by a TNC and a TNC driver during the time in which the driver is logged in to the APP and is available to provide transportation network services, and during the time in which the driver is providing transportation network services. Reduces the minimum coverage and uninsured motorist coverage for commercial policies for vehicles with a seating capacity of not more than 8 passengers to $250,000, from $300,000. Beginning March 1, 2016, a motor vehicle liability policy is not required to insure liability for a private passenger motor vehicle used while a TNC driver is logged in to a TNC’s APP or is providing transportation network services, unless expressly covered by the private passenger policy. Beginning March 1, 2016, the list of reasons that insurers may cancel or fail to renew a motor vehicle insurance policy is expanded to include that the named insured or any other person who regularly and frequently operates a motor vehicle insured under the policy uses the motor vehicle as a TNC vehicle to provide transportation network services, unless the named insured either has procured an endorsement to the private passenger policy that expressly provides such coverage or is covered by a motor vehicle liability insurance policy issued by another insurer specifically providing such coverage. Motor vehicle insurers are authorized to issue an endorsement to a private passenger policy that expressly provides coverage for the provision of transportation network services, but that endorsement cannot be treated as basic coverage and any termination of the endorsement cannot be treated as a modification of basic coverage. TNCs are required to disclose to TNC drivers of the insurance coverage and limits of liability that the TNC provides while the driver uses a TNC vehicle in connection with the TNC’s APP, that the TNC driver’s own insurance policy might not provide coverage while the driver uses a TNC vehicle in connection with the TNC’s APP, and that the driver’s use of a vehicle that has a lien against it to provide transportation network services for the TNC might violate the terms of the driver’s contract with the driver’s lienholder. AS SIGNED BY GOVERNOR.

It is a class 1 (highest) misdemeanor to conceal or falsify information that is collected for placement or contained in a hospital report or record that is related to the timing of when a patient receives care or the number of patients treated at the hospital.

For the purpose of statutes regulating service companies, the definition of “service contract” is expanded to include a contract for services relating to the maintenance or repair, including replacement, of tires or wheels, dents or creases that can be repaired using a paintless dent removal process, chips or cracks in windshields, and vehicle key or key fobs. “Service contract” does not include the repair of damage to or replacement of the interior surfaces or exterior paint or finish of a motor vehicle unless the coverage is provided in connection with the sale of a vehicle protection product. Also modifies the definition of “vehicle protection product.”

Insurance compliance audit privilege is extended to any insurance compliance audit document, instead of only self-evaluative audit documents. Insurance companies are no longer required to notify the Department of Insurance prior to the initiation of an insurance compliance audit and at the conclusion of the audit. A person who conducts or participates in the preparation of an audit and who has observed physical events is permitted to testify regarding those events, but cannot be compelled to testify or produce documents related to any privileged part of the audit or an audit document. AS SIGNED BY GOVERNOR.

A voluntary domestic organization of surplus lines brokers that contracts with the Department of Insurance is required to be incorporated in Arizona as a nonprofit corporation, and licensed surplus lines broker may be a member in the organization by paying membership fees. The organization is required to hold an annual meeting and is authorized to collect "stamping fees" (defined) from licensed surplus lines brokers. AS SIGNED BY GOVERNOR.

Various changes relating to credit for reinsurance. A domestic ceding insurer must be allowed credit for reinsurance as either an asset or a reduction from liability only when the reinsurer meets a list of specified requirements, including that the reinsurance is ceded to an assuming insurer that is licensed in Arizona and accredited by the Department of Insurance (DOI) as a reinsurer. Credit for reinsurance cannot be granted unless the form of the trust and any amendments have been approved by the director or commissioner of the state where the trust is domiciled or of another state that has accepted principal regulatory oversight of the trust. Establishes various regulations for the trust, including requirements for reinsurance agreements, trusteed surplus requirements, and reporting requirements. Certified reinsurers are required to secure obligations assumed from U.S. ceding insurers at a level consistent with its ratings, and various other requirements for certified reinsurers are established. If the trust fund is inadequate or if the grantor of the trust has been declared insolvent or placed into receivership or similar proceedings, the trustee must comply with an order of the department with regulatory oversight or with a court order directing the trustee to transfer to that department all assets of the trust fund, and the assets must be distributed by the department in accordance with the applicable state laws for liquidation. If an accredited or certified reinsurer ceases to meet the requirements for accreditation or certification, DOI is authorized to suspend or revoke it after notice and an opportunity for a hearing. DOI is authorized to adopt rules relating to credit for reinsurance. More. AS SIGNED BY GOVERNOR.

The list of medically necessary health and medical services that AHCCCS contractors are required to provide is expanded to include orthotics ordered by a physician or primary care practitioner if specified conditions are met, including that the orthotic is less expensive than all other treatment options. The AHCCCS Administration is required to submit an application to the Centers for Medicare and Medicaid Services for approval of orthotic services. AS SIGNED BY GOVERNOR.

If a health insurance enrollee pays the direct pay price to an out-of-network health care provider or facility for a lawful health care service that is covered under the enrollee's health care plan, the amount paid by the enrollee must be applied first to his/her in-network deductible, with any remaining monies being applied to his/her out-of-network deductible, if applicable. The amount applied to the in-network deductible must be the amount paid directly or the insurer’s highest in-network contracted rate in Arizona for the service or services, whichever is lower. If an enrollee is enrolled in a high deductible plan that qualifies the enrollee for a health savings account, the health care system is not liable if the enrollee submits a claim for deductible application of a direct pay amount that jeopardizes the enrollee’s status as an individual eligible for favorable tax treatment of the health savings account. Does not create any private right or cause of action for or on behalf of any person against the health insurer. Effective January 1, 2017 and applies to policies, contracts or plans that are issued or renewed beginning January 1, 2017. AS SIGNED BY GOVERNOR.

Statute imposing retaliatory taxes on insurers of another state or foreign country that impose such taxes on Arizona insurers does not apply to insurers that do business in Arizona and that are domiciled in another state or foreign country that does not impose retaliatory taxes or whose laws, on a reciprocal basis, exempt from retaliatory taxes similar insurers domiciled in Arizona that do business or might seek to do business in that state or foreign country. Effective January 1, 2016. AS SIGNED BY GOVERNOR.

The list of medically necessary health and medical services that AHCCCS contractors are required to provide is expanded to include podiatry services performed by a licensed podiatrist and ordered by a primary care physician, emergency dental care and extractions for persons who are at least 21 years of age, orthotic devices ordered by a physician, and chiropractic services that are ordered by a primary care physician. The list of services that ALTCS contractors are required to provide is expanded to include emergency and preventative dental services.

The Primary Care Provider Loan Repayment Program may be used to pay off portions of education loans taken out by pharmacists, advance practice providers and behavioral health providers who meet other program qualifications, including service for at least two years in rural areas or high-need health professional-shortage areas. Increases the maximum amount of loans for each provider that may be repaid with Program monies. Repeals the Behavioral Health Practitioners Loan Repayment Program.

State health care providers, hospitals and outpatient surgical centers are required and other health care entities are authorized to conduct "quality assurance activities" (defined), and health care entities are authorized to share "quality assurance information" (defined) with appropriate state licensing or certifying agencies and with licensed health care providers who are the subject of quality assurance activities. Regulations on the confidentiality of quality assurance information are modified, including specifying that sharing information about quality assurance activities as permitted by this legislation does not waive or otherwise impair the confidentiality of the information, and that information that is otherwise discoverable does not become confidential based solely on its submission to or consideration by a health care entity conducting confidential quality assurance activities. Contains a legislative intent section. AS SIGNED BY GOVERNOR.

For the purpose of statutes regulating health care institutions, the definition of “health care institution” is expanded to include "nonmedical housing for outpatient treatment center" (defined) and the definitions of various services are expanded to include substance abuse recovery support. A "nonmedical sober-living home" (defined) is required to file a registration form with the Department of Health Services that includes specified information. The Dept is authorized to establish a filing fee for the registration. AS PASSED HOUSE.

The insurance premium tax rate for insurance other than fire, disability, and health care service and disability insurance is annually reduced from the current rate of 2 percent to specified lower rates in calendar years 2016 through 2025 and to 1.70 percent in calendar year 2026 and beyond. AS SIGNED BY GOVERNOR.

The state and all political subdivisions are prohibited from using any personnel or financial resources to enforce, administer or cooperate with the Affordable Care Act by funding or implementing a state-based health care exchange or marketplace, limiting the availability of self-funded health insurance programs, funding or aiding in the prosecution of any entity for a violation of the Act, or funding or administering any program or provision of the Act other than those involved with AHCCCS, health insurance navigators and other specified programs. Some exceptions, including that the state and all political subdivisions are permitted to use personnel or financial resources to provide employee health insurance benefits, and those benefits may be in compliance with all provisions of the Act. AS SIGNED BY GOVERNOR.

A person is permitted to obtain any laboratory test from a licensed clinical laboratory on a direct access basis without a health care provider's request or written authorization, provided that the laboratory offers that test to the public on a direct access basis. For tests conducted not at the request or authorization of a physician, the test results must be reported to the person who was the subject of the test and must state in bold type that it is the person's responsibility to arrange with the person's health care provider for consultation and interpretation of the test results. A health care provider's duty of care to a patient does not include any responsibility to review or act on laboratory test results that the provider did not request or authorize. A clinical laboratory cannot submit a claim for reimbursement from a third party payor for any laboratory test conducted without a health care provider's request or written authorization. Does not require that a laboratory test be covered by a health insurance plan or product or by any AHCCCS program. The Department of Health Services is required to adopt rules to address the changes in direct access laboratory testing in this legislation. AS SIGNED BY GOVERNOR.

The members of the Legislature declare that Arizona residents who are enrolled under the Patient Protection and Affordable Care Act are not eligible for subsidies and that Arizona businesses are exempt from the regulations, requirements and fines under the Act because Arizona did not establish a state-run exchange. The Secretary of State is directed to transmit copies of this resolution to the Department of Health Services and the Arizona Commerce Authority for posting on each agency’s website.

The Board of Chiropractic Examiners is required to review the amount of each statutorily authorized fee in a public hearing at least once each fiscal year and before establishing the amount of a fee for the subsequent fiscal year. Increases the maximum fee the Board may establish for various licenses and applications. The Board is authorized to issue a chiropractic license by endorsement to an applicant who has actively practiced chiropractic in another state or jurisdiction for at least five of the immediately preceding seven years and who meets other specified requirements. Due to a potential increase in state revenue, this bill requires the affirmative vote of at least 2/3 of each house of the Legislature for passage, and becomes effective immediately on the signature of the Governor. AS SIGNED BY GOVERNOR.

A doctor of medicine who holds an active and unrestricted license to practice medicine in another jurisdiction in the U.S. may practice in Arizona without applying for a license until his/her license expires in that jurisdiction if specified conditions are met, including notification of the Arizona Medical Board.

By March 30 of each year, the AHCCCS Director is required to apply to the Centers for Medicare and Medicaid Services for waivers or amendments to the current section 1115 waiver to allow Arizona to institute a work requirement for all "able-bodied" "adults" (both defined) receiving AHCCCS services, place a lifetime limit of five years of benefits on able-bodied adults except in specified conditions, and develop and impose meaningful cost-sharing requirements to deter the nonemergency use of emergency departments and the use of ambulance services for nonemergency transportation or when it is not medically necessary. By April 1 of each year, the Director is required to submit a letter to the Governor and the Legislature confirming the submission of the waiver requests. AS SIGNED BY GOVERNOR.

The repeal date for the quality assessment on health care items and services provided by nursing facilities, which is used for supplemental payments to nursing facilities for covered Medicaid expenditures in order to obtain federal financial participation in the services, is extended eight years to October 1, 2023. If a nursing facility does not pay the full amount of the assessment when due, the AHCCCS Administration is authorized to suspend or revoke the facility’s AHCCCS provider agreement registration. Subject to approval by the Centers for Medicare and Medicaid Services, a nursing facility located outside of Arizona cannot receive payments for quarterly nursing facility adjustments. AS SIGNED BY GOVERNOR.

A health care insurer who utilizes the services of an outside utilization review agent is responsible for the administration of all patient claims processed by the utilization review agent on behalf of the health care insurer. AS SIGNED BY GOVERNOR.

The Primary Care Provider Loan Repayment Program (Program) and the Rural Private Primary Care Provider Loan Repayment Program (Rural Program) may be used to pay off portions of education loans taken out by pharmacists, "advance practice providers" (defined as a physician assistant or registered nurse practitioner) and "behavioral health providers" (defined) who meet other Program or Rural Program qualifications, including service for at least two years in rural areas, high-need health professional-shortage areas or medically underserved areas. Increases the maximum amount of loans for each provider that may be repaid with Program monies. The Department of Health Services is permitted to implement the Program independent of federal grants based on the needs of Arizona, and to use monies to develop programs such as employer recruitment assistance to increase participation in the Program. Repeals the Behavioral Health Practitioners Loan Repayment Program. AS SIGNED BY GOVERNOR.

Counties and municipalities are prohibited from requiring an owner, operator or tenant of a business, commercial building or multifamily housing property to measure and report energy usage and consumption. Counties and municipalities are prohibited from imposing a tax, fee, assessment, charge or return deposit on a consumer or an owner, operator or tenant of a business, commercial building or multifamily housing property for "auxiliary containers" (defined as reusable bags, disposable bags, boxes, beverage cans, bottles, cups and containers that are made from specified materials and that are used for transporting merchandise). Counties and municipalities are prohibited from regulating the sale, use or disposition of auxiliary containers by an owner, operator or tenant of a business, commercial building or multifamily housing property. Does not prevent a county or municipality from continuing a voluntary recycling and waste reduction program or ensuring that discarded auxiliary containers defined as solid waste are disposed of properly. AS SIGNED BY GOVERNOR.

The Department of Health Services (DHS) Division of Behavioral Health is repealed and the Division’s powers and duties for various mental and behavioral health services are transferred to the AHCCCS Administration, except for those relating to the state hospital, in order to conform to Laws 2015, Chapter 19 (part of the FY2015-16 budget). The AHCCCS Administration is required to act through the Regional Behavioral Health Authorities to establish and operate various existing behavioral health programs. Statute governing contracts with RBHAs for behavioral health services is repealed and replaced. The DHS Director, instead of the Deputy Director of the Division, has charge of the state hospital and related responsibilities and duties. DHS is required to adopt rules relating to the state hospital, including standards for providing services and admission and transfer of patients. DHS is required to present a budget request for the state hospital and to submit an annual report on the state hospital to the Governor and the Legislature. Repeals the Serious Mental Illness Services Fund and transfers all unexpended and unencumbered monies remaining in the Fund to the general fund on the effective date of this legislation. By November 15, 2015, the AHCCCS Administration and DHS are required to submit a joint report for review by the Joint Legislative Budget Committee and the Governor’s Office of Strategic Planning and Budgeting that details the transfer of resources between the two departments. Effective July 1, 2016. AS SIGNED BY GOVERNOR.

Various changes relating to dentistry and licensees of the State Board of Dental Examiners. Dental assistants are authorized to perform “expanded functions” (defined) on successful completion of a Board-approved expanded function dental assistant training program at an accredited institution. Statutes defining unprofessional conduct for Board licensees and authorizing licensed dentists and licensed dental hygienists to enter into an affiliated practice relationship are repealed and replaced. Adds a new chapter to Title 36 (Public Health) regulating “teledentistry” (defined). The AHCCCS Administration is required to implement teledentistry services for enrolled members who are under 21 years of age. AS SIGNED BY GOVERNOR.

If a health insurance enrollee pays the direct pay price to a health care provider or facility for a lawful health care service which is covered under the enrollee's health care plan, the amount paid by the enrollee must be applied to his/her in-network deductible, with any remaining monies being applied to his/her out-of-network deductible, regardless of whether the provider or facility is a contracted network provider for the enrollee’s health care plan. AS PASSED SENATE.

A health or disability insurance contract or evidence of coverage that is issued or renewed on or after January 1, 2017 and that provides coverage for prescription drugs is prohibited from denying coverage and must prorate the cost sharing rate for a covered prescription drug that is dispensed by a network pharmacy for less than the standard refill amount if the insured requests enrollment into a "medication synchronization" (defined) program and "less than the standard refill amount for the purpose of synchronizing the insured's medication." A health or disability insurance contract or evidence of coverage that is issued or renewed on or after January 1, 2017 and that provides coverage for prescription drugs is required to accept early refill and short fill requests for prescription drugs using the submission clarification and message codes adopted by the National Council for Prescription Drug Plans or alternative codes provided by the plan on the effective date of this legislation. AS SIGNED BY GOVERNOR.

The list of conditions under which the court may order a defendant to be involuntarily confined until an examination of competency to stand trial is completed is expanded to include that the defendant is charged with a “serious offense” or a “violent or aggravated felony” (both defined elsewhere in statute). If a mental health expert determines that there is no substantial probability that a defendant will regain competency to stand trial within 21 months, the expert’s report must include whether the defendant should be considered “dangerous” (defined) or may be a sexually violent person. If the court holds a competency hearing, the state is required to prove by clear and convincing evidence that the defendant is dangerous and committed the charged offense. The court is permitted to retain jurisdiction over a defendant throughout the time necessary to determine the defendant's appropriate treatment options and the implementation of the court's treatment orders. The court is authorized to order an assessment to determine the defendant's eligibility for private insurance or public benefits that may be applied to the expenses of the treatment. Counties are authorized to establish a behavioral health advisory board to recommend to the court a continuum of care plan for a defendant and supervise the delivery of services to the defendant, and powers and duties of an advisory board are specified. More.

Health and disability insurance contracts and policies issued to an individual or "small employer" (defined elsewhere in statute) are no longer exempt from the prohibition on excluding or denying coverage for a treatment based on the diagnosis of autism spectrum disorder or for medically necessary behavioral therapy services. The maximum benefit per year for behavioral therapy coverage is deleted.

Safe haven providers (where a person may voluntarily deliver a newborn infant) include the health care institution where the infant was born. Even if the safe haven provider has identifying information about a parent or an agent of the parent, it does not preclude the application of safe haven statutes.

Health insurers offering or renewing a health plan on or after January 1, 2017 are required to post the “formulary” (defined) for the health plan on the insurer’s website in a manner that is accessible and searchable by the enrollees, potential enrollees and providers. Information that must be included in the published formulary is specified.

Health and disability insurers are prohibited from imposing as a limitation on treatment or level of coverage a copayment, coinsurance or deductible amount for services provided by a licensed chiropractor, physical therapist, occupational therapist or respiratory care examiner that is higher than the copayment, coinsurance or deductible amount for the services of a “primary care physician” (as defined in the health insurance plan) licensed as a medical doctor or doctor of osteopathy for the same medically necessary treatment or condition.